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2015 Compliance risk study: Be the disruptor, not the disrupted

The 2015 Compliance Risk Study suggests compliance has retained its position as a critical control function for financial institutions.

Overview

Compliance officers at banking, insurance and capital markets firms around the world can expect to play a central role in shaping the financial services industry, provided they keep ahead of a changing ecosystem.

But to ensure their relevance and retain their seat at the table, compliance officers must keep ahead of the changing financial services ecosystem, positioning themselves and their businesses to be a disruptive force—and not the disrupted.

Background
Accenture’s 2015 Compliance Risk Study is based on a survey of leading compliance officers at 150 banking, insurance and capital markets firms across the Americas, Europe and Asia-Pacific. The 2015 effort builds on last year’s study, focused on the rising stature of compliance. The study explores steps required to help future-proof and cement the elevated role of the compliance function within the organization.

Key Findings

The 2015 study confirms compliance remains a valued function that is rising in importance, with more than three in four compliance officers reporting directly to the CEO or the board of directors. Almost 90 percent of respondents expect investment in compliance to increase in the coming two years.

The study uncovered four themes highlighting compliance’s successes to date, as well as continuing challenges:

Compliance has kept its “seat at the table.” For the past year, the compliance function has maintained its importance and deepened its value and capabilities. Its “seat at the table” is yet to be challenged.

A changing ecosystem demands greater compliance awareness. External and internal changes in the business are driving changes to the compliance function. Eighty percent of respondents believe these changes are significant enough to affect banking business models—and compliance may need to rethink its operating model.

Creating and retaining relevance and value are critical to the compliance function. To remain forward thinking, compliance must ensure its relevance. Our study found that prioritizing predictive capabilities, developing partnerships with industry peers, cultivating a talented workforce and maintaining operational discipline will help drive the function forward.

Be the disruptor, not the disrupted. Compliance, according to 80 percent of respondents, is positioned to drive cultural change and improved ethical behavior in financial organizations. Bold actions are needed to ensure compliance secures its place as a strategic business partner and a positive disruptive force.

Recommendations

We believe that to thrive as a strategic partner, compliance should become a disruptive force. Compliance functions should become more aware of the changing ways in which consumers interact with their financial services providers in the digital space, and the new types of products, transactions and ways of working that this transformation brings.

Compliance leaders will need forward-looking capabilities, such as data management and analytics, to anticipate changes. Compliance cannot solve for every emerging risk, so its practitioners should acquire the skills that help influence cultural and ethical change, thus encouraging self-correcting and self-policing behaviors. By taking these and similar steps, compliance can begin to use its “seat at the table” for positive disruption.

Authors

Samantha Regan is a managing director in Accenture’s Finance & Risk Services. She has 17 years of global experience working with C-suite executives and their businesses in compliance and regulatory initiatives.

Ben Shorten is a senior manager in Accenture’s Finance & Risk Services, and serves as the Strategy and Target Operating Model offering lead for Regulatory Remediation & Compliance Transformation in North America.

Rafael Gomesis a senior manager in Accenture’s Finance & Risk Services, and serves as the Conduct Risk offering lead for Finance Services Consulting in the United Kingdom.

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